Costa Rica Coffee Guide

Area Complaints Slow Dam Construction

October 29, 2004

CONSTRUCTION on a tunnel crucialfor the development of the La JoyaHydroelectric Dam project in Tucurrique,Cartago, east of San José, was halted Oct.22 by the administrative tribunal of theEnvironment and Energy Ministry(MINAE) after the city’s municipal councildrafted an official complaint aboutdamage to area water sources.“Obviously, that’s the heart of thefunctioning of the project,” said EnriqueChaves, assistant to Tucurrique MayorHector Luna and a spokesman for themunicipality, in reference to the tunnel.“But they can carry out some collateralactivities. Of course they are minimal,”he said.Chaves explained the project has notbeen shut down, as was announced byenvironmentalists after the council votedOct. 13 to file the complaint with theEnvironment Ministry.He said the Spanish-Costa Rican companyconstructing the dam, Unión Fenosa,has only been prohibited from using anexcavator to dig the tunnel, which wouldeventually carry water for the hydroelectricplant’s turbines.LA Joya is a $77 million, 50-megawatthydroelectric dam scheduled to begin operatingin December 2005. Under the terms ofthe contract Unión Fenosa has with the government,awarded in late 2003, the companywill operate the dam for 17 years, afterwhich time the Costa Rican ElectricityInstitute (ICE) will take over.The contract has come under scrutiny inrecent weeks, after former ICE board memberJosé Antonio Lobo, who implicated formerPresident Miguel Ángel Rodríguez inan alleged corruption scandal involving ICEand the French telecommunications firmAlcatel, also linked Unión Fenosa to allegedillicit payments.In his Sept. 30 declaration to theProsecutor’s Office, according to informationleaked to the daily La Nación, Lobosaid that Gerardo Bolaños, a former boardmember of the Social Security System(Caja) and a legal advisor to UniónFenosa, made two $28,000 payments toLobo after the ICE board awarded thecompany the contract for the hydroelectricproject (TT, Oct. 8).THE Costa Rican Federation for theConservation of the Environment(FECON) issued a statement about thedam in which it questions whether UniónFenosa has the “technical capacity” tocarry out the project, in light of the allegationsthat payments may have played apart in the company winning the contract.FECON also claims that during initialconstruction, residents of the nearby communitiesof El Oso, La Flora and Chucuyowere left without water.Chaves said those communities havehad their normal water supply temporarilycut off, but Unión Fenosa has been refillinglocal supply tanks with huge cisterns,so “at no time was anyone left withoutwater.”He did say that in several “isolatedcases,” farmers have had difficulty gettingsufficient water for their crops.“We are all in agreement that it is notthe best method,” Chaves said. “But thatdoes not mean the company has not giventhem water.”HE said Unión Fenosa has obtainedall necessary permits for the project,including the approval of the HealthMinistry, municipal approval and approvalfrom the National Technical Secretariat ofthe Environment Ministry (SETENA) ofits environmental impact study.

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